Sharma for ending stimulus to export sectors growing robustly
The Finance Ministry could consider withdrawal of stimulus to some exporting sectors which have shown robust growth, but an across-the-board "abrupt" pullout is not desirable, Commerce and Industry Minister Anand Sharma said.business Updated: Mar 19, 2010 11:12 IST
The Finance Ministry could consider withdrawal of stimulus to some exporting sectors which have shown robust growth, but an across-the-board "abrupt" pullout is not desirable, Commerce and Industry Minister Anand Sharma said in New Delhi on Monday.
"Those sectors which have moved into a very robust growth level, there we can consider (withdrawal of stimulus)," Sharma said when asked whether there is a case for stimulus withdrawal in the budget.
After exports started contracting from October 2008, the government had given certain sops like interest subsidy and higher duty refunds to help exporters.
With exports turning positive after 13 months from November 2009 and manufacturing becoming robust with estimated growth of 8.9 per cent for the fiscal, possibility of stimulus withdrawal is being debated.
Planning Commission Deputy Chairman Montek Singh Ahluwalia too joined the debate. "... stimulus has succeeded and we should begin to phase it down. Fiscal deficit next year would be lower than that of this year," Ahluwalia said.
The Federation of Indian Export Organisations (FIEO) is also not opposed either to withdrawal of the benefits to those sectors which are now doing well. These include gems and jewellery and pharmaceuticals.
"The sectors which have done exceedingly well can be taken out of the stimulus benefit so that those still showing decline or moderate growth can be given focused assistance," FIEO president A Sakthivel said.